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It has been 4 gens (5th to 8th) during which Nintendo and Sony have been competing for market dominance, and 3 gens during which Microsoft joined the melee.

When Microsoft entered the console market, the Xbox was seen as a new entrant, since Sony had already succeeded with the PS1 and made itself a name for itself a gen ahead of Microsoft, and had dethroned Nintendo from the #1 spot, and the PS2 was already very successful by the time MS came in. To make things more new for Microsoft, they were the 4th player in a battle that was normally waged between two or three players (Sega vs Nintendo, then Nintendo vs Sega vs Sony). Also, while the big players were always japanese (except in the 1st & 2nd gens), Microsoft was not a japanese company and was from another industry: computer operating systems and a handful of PC peripherals and games.

After 3 gens in the console space, Microsoft is starting to show its guts with their new moves gearing up for next gen. As the next gen starts, Sony will have been a long-time player, with the Playstation celebrating its 25 years in the industry and launching it's 5th generational console, which Sega stopped at 4 (Master System, Genesys, Saturn, Dreamcast). Microsoft will finally have its 4th generational console, now being almost as old as Sega was when it left the home console race.

Sony now, after having completed 4 gens in the industry, has outlived Sega (in gens lived), and Microsoft will soon outlive Sega's gen lifespan 2 years after the Series X/S is released (the dreamcast was discontinued in 2001, two years  after launch).

These players, albeit newcomers at the time they entered the industry, are now cemented into the landscape as the 3 main players of the industry for a long time to come. While in the past a few contenders were fighting for the crown (Nintendo, Sega, Bandai, Neo Geo, Atari), for the last 4 generations it was mostly fought over by 3 main players: Nintendo, Sony and Microsoft. 

Nintendo is a veteran here, having starting on consoles since the first generation with the Color TV-Game series of consoles. Skipping gen 2, they then have been in consoles for 6 consecutive generations (NES, SNES, N64, GC, Wii, WiiU/Switch) or 7 depending on how you see it (WiiU gen 8, Switch gen 9), and also have experience from 4 portable generations (GB, GBA, DS, 3DS). They are currently at their most solid point in their history. While the Wii and DS sold very strongly, their success was expected to be short-lived from signs that were visible during the Wii era: lots of Wii shovelware, and hints that the motion-control novelty would eventually wear off. However, with the Switch, we see a Nintendo console which on one hand is selling very well, and on the other hand, enjoys a robust library of high-quality compelling games. They have also taken over a complete main geographical region of the gaming world, Japan. Having already tasted success with the DS and Wii, Nintendo seem more aggressive, cautious and confident in their new direction as the Switch succeeds.

Sony started off with success as of the release of FFVII on the PS, and rode that success fairly smoothly until the PS3. While the PS3 staggered a little, it still sold considerably well, and then the PS4 regained its lost ground, while never reaching the same success as the record-breaking PS2. Over the gens, Sony has acquired and built studios, gaining development grunt and collecting a fair chest of exclusive IPs property of Sony. This puts Sony in a much stronger position as even compared to the PS2 era, since its reliance on 3rd parties, while always very important, is less overwhelmingly dependent. On the handheld side, while the PSP seemed to share some of the fire of its home console cousins, the Vita showed that Sony was not dedicated to the handheld space, and that Nintendo had a stronghold on that segment of the market, and so Sony exited. While the sales of the PS4 don't match the dominance PS enjoyed during their 1st and 2nd gens on the market (in market share), their overall position is more safe due to their experience in the market and the IPs they've acquired.

Microsoft entered the industry with a lot of potential. Whether it was being seen as the spiritual successor to the Dreamcast, or their purchase of Rare, Microsoft had somehow created their rightful place in the industry despite their rotten image during the Netscape days. After a somewhat shaky start sharing 2nd/3rd place with Nintendo's floundering Gamecube, they entered the next gen early with the 360 and enjoyed the support of the great majority of 3rd party publishers, having almost all the same games as the Playstation that were not made by Sony or its partners, even the most shocking PS-true series such as Final Fantasy and GTA. After MS seemed to drop the ball with the Xbox One, Phil Spencer has steered the ship in the right direction, and is making all the right moves in preparation for the next generation. With the series S at 299$, or 25$ per month with Xbox All Access, and with the recent purchase of Bethesda, Microsoft is getting ready to change the power dynamics of the industry, leveling the playing field for all three competitors.

Next gen is most likely to see Sony and MS neck and neck from start to finish, with Nintendo enjoying the success of the Switch for an extended period of time, most likely with a new Switch model sometime late next year (soft gen for Nintendo). The console sales will be strong for all three players and the industry seems to have entered a kind of stability where all three players can succeed at the same time, much in the spirit of the PSWii60 gen, but this time with Nintendo in a much more robust shape.

Last edited by padib - on 22 September 2020